tv Street Signs CNBC November 12, 2012 2:00pm-3:00pm EST
thanks for watching "power lunch." we'll be back with you tomorrow. >> the dow is up 29 points on the trading session. so let's hand it over to the "street signs" crew. ty and i will see you tomorrow. we begin "street signs" with a moment of silence for thanksgiving -- because the retail race is getting even crazier. more stores opening early. is it genius or pure insanity? only 16 days left. not shopping days until christmas -- but congressional working days left to fix the cliff. plus, america on track to be the king of oil. do we have the guts though to assume the throne? and battleground long island. a powerful story about lack of power and whether it could happen in your neighborhood. hello, everybody. mandy's of off today but we've got a big show for you, including more on why apple's profit margin may get squeezed and why microsoft is down today.
the dow is up for the fourth monday in a row not counting the october 29th market closure because of super storm sandy. the s&p 500 slightly higher today trying to recover from its biggest weekly point and percentage loss in five months. and the nasdaq off to a positive start as it tries to avoid a sixth consecutive losing streak. the retail mania is really out of control. retailers are so desperate to get your cash they've pretty much canceled thanksgiving. black friday has always been the big day for stores. now more stores keep trying to one-up each other by opening earlier and earlier and earlier. some even now on thanksgiving night. we are all over the story that's got you, in part, outraged. we begin with courtney reagan. courtney, first, the litany of stores that are trying to rip you away from the thanksgiving >> let's not put all of them on the naughty list just yet. retailers say they're offering
thanksgiving hours because it is what the consumers demand. according to the national retail federati federation, nearly 25% of plaque friday shoppers were at the stores by midnight last year. thanksgiving hours have actually proven very popular with the millennial crowd and men who would rather shop late thursday than pre-dawn friday and escape a little family, too. who's hoping shopping bags will be just as full as stomachs on thanksgiving? toys "r" us opening at 8:00 p.m. walmart opens at 8:00. sears shoppers can start shopping online as early as the sunday before. target opening at 9:00 p.m. sports authority will open most its stores at midnight. >> before we move on, are these folks -- i'm not worried about the shoppers. that's their decision. what about the workers? are they getting quadruple pay
for this? >> it varies by retailer but most of the standard procedure is to pay overtime hours as you would for working holidays. most are accepting folks that want to volunteer first before making any one employee work. joe philbin is managing director. joe? >> i think it helps capture market share for retailers. it certainly extends the holiday season a little bit longer and it is really about getting that sale before your competitor does. being open a little earlier should help the retailers. may not mean incrementally more sales but it could definitely capture more for retailers that are open. >> is black thursday as i'm calling it going to steal sales from the next day or will it still that be powerful period? >> i think there is still a lot of buzz and excitement around black friday. it is interesting what we saw last year when we were out in the stores at midnight it was a much younger crowd in the morning on black friday it was definitely an older crowd. i think it elongates the period a little bit based on who is going to be in there. >> who do you think could really
benefit from this, joe? not just the ones that are open. right? who's going to get sales earlier really? who's going to win? >> i think walmart really does win. i think target really does win. these guys, they're mass merchants, they have great prices, they have good assortments, there is a lot of things with gifts and electronics and sweaters and all sorts of things for the family that you can buy in those stores. in this economy, i think that that value priced shopper wants to go to that big box store. >> we actually have donna rice-hughes on the phone right now from enough is enough. donna, welcome to "street signs." thanks for joining us here on cnbc. is there an -- i'm not some prima donna, but isn't this a bad thing for the american family? shunned some things remain sack r . >> i actually do love to shop but i do think we've got a
couple of sacred days, thanksgiving and christmas. those really are such a special time for families and friends to be together, family, friends, food and football. i don't want to see us necessarily start a trend of having black thursday. it seems like to me they could start a little earlier on friday morning and extend the sales maybe through that sunday or monday. but i can understand going earlier on thursday rather than people standing in line to get into a store at midnight. but i disagree with wholeheartedly that midnight opening. it is just crazy. >> i agree and disagree. the point i want to make sure i'm making to the audience is that for me, if you want to shop, shop. i'm not going to tell anybody when they can do anything. it is when you are forcing the workers to come in, the truck drivers, the security guards that have to be there for the lines. they don't have a choice. >> but the other thing is, when you're putting things at rock
bottom prices and people feel compelled that in order to save money to get an item that they think they need or someone in their family needs or they want to get to have to leave that holiday and get up from family and friends and food and go out because they need that sales point break i think is what is -- what i find problematic. >> donna rice hughes, president of enough is enough. 8:00 p.m. would be enough on thanksgiving night. thanks very much. bottom line before we move on with courtney reagan and joe, i don't know how to read it. are retailers telling you they think this is going toob big deal for them? are they really going to have millions of people ready to trample into the stores on thanksgiving? >> i don't know if it is millions but it is enough that it makes sense for them to do it. they tested it two years ago. last year was pretty popular. no one's forcing to you go to the stores to shop. gives you an extra opportunity
to get away from family perhaps, get those extra sales. >> your parents watch this show? >> i've got to be there anyway so i already have my built-in excuse. >> what do you think? is this really a big story from a retail perspective from a numbers perspective, from an earnings perspective? or is it really just sort of a story story? >> i think it is more of a story story. i think it will help a little bit on the numbers but not a lot. like i said, i think it is about capturing market share. if a store is open when another one isn't, you're getting that sale potentially. if you have that great price and you can beat somebody to the punch, why not go after it. i understand the impact on the employees and the store labor and that's a challenging one. but it does seem like they make it into a fun event and they get everybody excited about being there and you're partaking in something that's kind of a unique experience. it can be fun, too. >> i guess i'm the only one, hey, who wants to watch the lions lose again. stick around.
that's not the only retail story today. at jcpenney ceo ron johnson resorting to new tricks to boost sales. company will hand out pins to customers. some will have codes on the back that can win you prices like a trip to disneyland. is that a great idea or is this gimmick? herb joins us now. joe and courtney are still here. are these going to work b, mr. pin? >> most are gimmicks except this one. but -- look. it is not going to i think bring more people into the stores but how is it any different than monopoly at mcdonald's? how is it any different -- there are people -- >> because this is a guy who said he's going to fundamentally change how people think of jcpenney. sales are over. now it is a scratch off the back of a pin and win? >> as they said on their conference call, call it what you may when people were talking about some of the promotions they are going to have. look, they're retailers. they're just trying to spin it differently. >> courtney, a scratch-off pin, does it get you in the door at jcpenney? >> what else gets you in the
door? >> price, quality, sales, selves. >> right. but black friday is an event and you ofrt free teddy bear, you offer the hot chocolate. whatever it is. >> but you're offering discounts. >> this really isn't any different. some of it is discounts but some of it is extra prizes. how is that different from what anybody else does? i used to get the bear at macy's. i still have all that stuff. it is extra advertising, it gets people in the door. >> come on, joe! >> ron johnson said back in january when he announced events, town square is going to be a place people want to go. town square. joe, what's your take? good idea or gimmick? >> both. they were offering free haircuts when kids went back to school and it brought in traffic. >> that's a nice service. this is literally a scratch off the back of a pin and win. t he said jc penny will be rebuilt from the inside out into a
modern store you want to go into, whether or not i presume, if you get a pin. >> but that doesn't change going into the store. that doesn't change what else ron johnson is doing necessarily. he's just also offering a pin. he's also offering extra incentive for folks to get into that store. it doesn't take away -- >> joe, does it feel like a last-ditch effort? >> no, i don't think it is last ditch. it is a traffic generator, creates a little bit of buzz. he's come at things fast and aggressive which is what a lot of people wanted to see. it's not panning out as well as some would have liked so far this year but it is not to say his thesis won't work over time. it may. i think that this is just part of a way to drum up some excitement around black friday like others are doing. >> not panned out the way people thought? joe, they lost 93 cents a share last quarter. they were supposed to lose 7 cents. >> no. it was an ugly quarter. clearly he's bitten off arguably a lot more than he can chew at the moment. >> bad news, dad, i didn't get into harvard. by the way, i dropped out of high school. that is not panning out.
joe, thanks very much for joining us. see you again. courtney, thanks. sorry to yell at you. >> i was getting hot and bothered, too, about this stuff. >> it is a fun show. herb? never mine. up next on "street signs," an epic tax fight. we're just getting warmed up. one guest says raise taxes on everybody, even you, the middle class. one says -- don't raise taxes on anyone. if lawmakers do not reach a budget deal to avoid the fiscal cliff, federal taxes will be raised by more than $500 billion in 2013. an average of almost $3,500 per household. tdd#: 1-800-345-2550 this morning, i'm going to trade in hong kong. tdd#: 1-800-345-2550 after that, it's on to germany. tdd#: 1-800-345-2550 then tonight, i'm trading 9500 miles away in japan. tdd#: 1-800-345-2550 with the new global account from schwab, tdd#: 1-800-345-2550 i hunt down opportunities around the world tdd#: 1-800-345-2550 as if i'm right there. tdd#: 1-800-345-2550 and i'm in total control because i can trade
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if a budget is not agreed upon to avoid the fiscal cliff, the average middle class family will pay almost $2,000 more in taxes. now to our continued countdown of the fiscal cliff. you've got 49 days, nine hours, 45 minutes and 38 second left until the end of the year. you may think that's a lot of time to find a solution to this big problem, but that, my friend, is misleading. there are actually only 14 more weekdays in november, and with holidays, kwng is in recess for six of them. there are only 20 weekdays in december. but you've also got to break out the holiday break which begins on december 14th. there are no votes in congress on december 7th or december 10th. so really, that's just eight
days in december and eight days in november for a total of -- you figured it out -- 16 working days left to fix the fiscal cliff. of course just because congress isn't in session doesn't mean talks don't continue or they can't come back or be forced back into washington, d.c. they've also been known to postpone their recess in necessary but that, my friend, does not leave a lot of time. big debate in the fiscal cliff is this. should we be raising taxes on the wealthy as the president wants and he defines that as $250,000 a year or more. some people said that's too low, make it $1 million. some people said raise taxes on everybody. let's talk about it with caved callahan, co-founder and senior fellow at demoss and dan mitchell from the cato institute. why should we raise taxes on every american? >> brian, if you remember that bush tax cut when first enacted in 2001 was meant to be
temporary and it was enacted at a time when we thought we had budget surpluses which turned out to be overstated, and even looking back retroactively, it wasn't affordable at the time which is why we racked up a huge amount of debt under george bush's presidency and it is certainly not affordable now, those bush tax cuts. the problem is if you only get rid of the tax cuts for the rich, it doesn't raise that much revenue. big money is in those middle class tax cuts. that's why i think, unfortunately, we have to get rid of all of them eventually. maybe not on january 1st but certainly in the near future. >> listen, i don't like the tax hike heereither. but it bears repeating, the president's tax plan is about six to eight days of government operating income. that's it. it is not going to do anything really. dan, that aside, you think bad idea, don't raise taxes on anybody. >> actually, i agree with david in the sense that if you don't do anything to control this ever
growing government which expanded under bush, now it is continuing to expand under obama, then, yes, sooner or later you're going to have to grab the middle class by the throat and choke them because there aren't enough rich people to finance big bloated government. that's why i'm standing in london. reason that they had these big value added taxes and social insurance taxes is the only way you can finance a welfare state is by squeezing the middle class. that's going to be bad for the economy, bad for those taxpayers just like taxing the rich is bad for the economy an bad for those taxpayers. >> you think the answer is 100% cut spending even though the roads are a billion years old, light poles blow over if you blow on them and no airport can do anything on time. >> that's one of the reasons we're so screwed up in this country, you see it in new jersey and new york. everyone waits for the federal got to do things and the federal government is probably the most incompetent institution on the face of the planet. what your viewers need to
understand is that in order to balance the budget in ten yearsing with all we have to do is limit the growth of spending to 2.5% a year. i want to cut spending but we don't need to do that. just constrain the growth of government. >> i hear you, dan. a lot of people would agree with you. david, what dan is ng, 60% of the budget entitlement, medicare, are you willing to say that 85 year-olds, sorry, no more medicare. >> ultimately there has to be a combination of both tax increases and spending cuts. >> where do we cut? >> i think everybody agrees that the big money is in health care expend turxpenditure expenditures. you got to start to bend that health care curve, hoiz it is impossible to get a handle on these deficits. the grand barring than was on the table, look for $4 trillion in deficit reduction, the simpson-bowles asked pore $4 trillion. just getting rid of those bush tax cuts all together gets you that $4 trillion without cutting a single cent of spending. then if you add on top of that
controlling health care costs and going after some other necessary areas of spending such as pentagon spending, you'd really make a dent in the deficit but you don't do it without serious revenue and just raising taxes on the rich is not going to get you very far. >> it is interesting, too, dan. i hate taxes. my property taxes have gone up. even as the value of my house has gone down. sales tax has gone up. no politics seems to know or have the guts to say. since 1980 the median federal income tax rate has dropped by over 50%. we paid 10.5% in 1980 and now with deductions we're the 4.5%. the middle class is not being taxed to death with federal income taxes. they may be getting whacked with other stuff but you'll agree it is not federal intomorrcome tax.
most families that earn $100,000 and have four children pay zilch. >> i don't think the answer is to sort of drag them into the swamp with the upper income people who are getting punished. here's one other thing for your viewers. every budget deal that we've had since 1980 where we had grand bargains with taxes on the table, the deficit went up, congress spent money. only budget deal that produced a budget surplus was the one in 1997 where we didn't raise taxes, we actually cut taxes. this is fundamentally a fight about the size of government. there's no way if government keeps growing faster than the private sector, there is no way tax increases will ever keep up with it. it will be like a dog its tail. you don't cure alcoholics by giving them keys to a liquor store. we're not going to get congress to control spending or the president to control spending if we put more revenue on the table. that just encourages the bad behavior. >> listen, i do agree. i try to take the other side.
i agree with a little bit of both of you said. that makes a good discussion. have a great day. thanks. cnbc will have continued coverage of the fiscal cliff. after the show is over go to fiscalcliff.cnbc.com for continuing coverage of this impending crisis. good afternoon. facebook is making a comeback today. we saw selling pressure this morning ahead of a another lockup expiration on wednesday. some analysts at goldman sachs recommend buy on the dip ahead of the expiration. could see some of that buying now. facebook gained more than 5% from its intraday low hit a little bit before noon today, it is coming off a little bit there. we're at $19.86, up 3.4% on the day. still ahead on "street signs" -- what could be the biggest threat to america's airlines and why all of us who fly should be a little bit nervous. plus, a serious delicious snack shortage to talk about. and the story behind this
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thmplts is the most amazing video that you will see all day. the floating city is actually floating. venice. flooded by heavy rains. 70% of venice is under water. it hasn't stopped the tourists from checking out the ancient city. look at that cruise ship. it's actually at sea but the way the camera angle is, looks like it is going right down the palazzo. airlines are having trouble finding pilots. it may be the biggest shortage in years. this isn't exactly a job you can asupply for and slide into. >> you're looking at a shortage coming in terms of the guys who are going to be flying our planes around the world particularly here in the united states. look at how many pilots are in the system right now and how many are needed over the next 20
years. you're talking about 96,000 right now. you're going to need more than that. 97,000 will be needed over the next 20 years. there is a coming wave of mandatory pilot retirements kicking in at age 65. they extended the age five years five years ago. they're starting to come due. more than half the u.s. pilots are over 50 years old. that's part of the problem. other part of the problem, airline pilot training now requires 1,500 hours of flying experience. the faa raised it just a few years ago. by 2014 airlines will be required to give pilots more rest. you're going to need more pilots in the system flying the same schedule for the airlines. worldwide look at the demand that is out there, particularly take a look at what's needed in asia. 185,000 pilots according to boeing will be needed by 2031. they're already starting to recruit here in the united states particularly the chinese airline. you look at the airline index over the last three months, the
focus is on jet fuel prices when you look at airline stocks and performance but look at what's going to be happening in terms of whether they can meet their schedules over the next couple of years because this is a real issue facing the entire industry and particularly here in the u.s. >> but i'm probably not alone in liking my pilots with experience. right? maybe it is not a bad thing. we're getting more populous so there's that as well. what do we do to fix it? >> i think there's going to be a lot of pressure put on the faa to at least lower that 1,500 hour limit for certain pilots. maybe perhaps your commuter flights. right now you're going to see the first flights that are going to be go, those commuter flights to area where they only have one flight a day. they'll ax those right away and keep the more populous routes going. maybe bring down the hours required for training. >> some solutions. trying to find them. thank you. from a pilot shortage to a world without twinkies, ding
dongs or ho-hos. hostess bakery imposed a contract that could put wages by up to 32%. why a report in a korean paper has apple investors today. plus imagine being in the dark for two weeks. no heat. no power. maybe even no running water. it's not in europe. it's not in third world greece. it is not in anywhere. it is here on long island and if it can happen here, it can happen anywhere. the unbelievable story coming up. the cnbc real-time exchange market snapshot is sponsored by interactive brokers. ♪
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rapid fire street talk time. microsoft. that stock down on some comments around the surface tablet from ceo steve ballmer. he told a french paper that the launch has been "modest." some interpret that to mean maybe sales were weak though microsoft contacted us and say, there may have been some mistranslation. he could have meant modest in terms of the way they did it. it's lost $3 a share since mid-september. apple is down even though it reached a global patent settlement with htc. reports out after korean paper that samsung may have increased the price of processors for the ipad and iphone by nearly 20%. that story came to us via the blog theverge.com. it could hurt profit margins and
shows the real risk of that friendmys relationship between samsung and apple. a pancreatic cancer drug trial where survival rates rose in one of the deadliest forms of cancer. celgene was added to top picks live at citigroup. rim we finally have a date. blackberry 10 will be launched january 30th. the first time we've got an firm date from research in mowing. the stock up 3.4%. j2.com is buying internet media company zip davis for $167 million giving them more web properties. they're paying in cash. they say it will instantly add $60 million in 2013 revenues as well as boost this year. keep in mind, this is a very hotly contested stock. very heavily shorted.
it's been a battle ground for some time. there's your very, very rapid fire street talk. let's bring in herb. when we talk about this this morning, you said jcom really interesting story. >> i get it, they've been growing by acquisition but this company buying zip davis communications, basically pc mag and these other businesses, this company is best known for e-fax and businesses like that. it has nothing to do with original business. they explain that they intend to do something going forward to sort of -- >> why not? everyone's killed them for that e-fax business. isn't this what they should do, diversify? >> diversify like this? as people would say, it ain't in their wheelhouse. we'll see how it turns out. this company's sales have been sliding. i want to mention something on the microsoft story. i must mention this. over the weekend over at the westchester mall, big mall here in the northeast, there's the microsoft store. saturday morning. so nothing going on in it. walk upstairs to the apple
store, it was just still packed. >> context first though. were there a lot of people in the mall -- given everything this area has suffered, were there a lot of people in the mall just not in microsoft? >> it was a slow, quiet morning that you would expect but i think when you have something hot you're looking at two supposedly hot concepts. you look at the surface, there's just no one in the microsoft store. >> but apple was rocking. >> it was not just rocking, it was just that microsoft store reminds me of sony's style which the stores were similarly just so-so. >> i hope i made that microsoft story clear. apparently when he said modest, perhaps the translation wasn't that sales were eh, it was that they weren't being bombastic about the launch. microsoft called this actually, said watch the translation. >> i'm just -- >> i understand. but i am trying to look at those retail stores as an indicator. if they're not, then what? >> channel check greenberg, everybody. they love it. thank you very much.
imagine being in the dark for 14 days. right? a full two weeks without power, without heat, without running water maybe, without help. that's exactly what's happening on long island, new york, just a few miles from the biggest city in new york or in america, think about that. if it could happen here, it could happen anywhere. katherine craig of wnbc has more. >> reporter: facing another week of being without electricity, frustrated baldwin harbor neighbors on long island took to the streets angry at lipa. >> we pay our bills just like everybody else. and like we never existed. baldwin harbor doesn't exist. >> reporter: tens of thousands of lipa customers have been without power since the beginning two weeks ago when sandy hit. lipa insists workers have been making good progress that 95% of its customers have their power back and almost everyone's electricity will be restored by the end of the day tomorrow. >> we certainly understand the frustration. i would say my appeal to those
customers is once the crews arrive, stand back and let them get their work done. they're there to help and to get the power bark on. >> reporter: many residents in darkened neighborhoods tell us that's easy for lipa to say. we talked with neighbors in ocean side. >> i don't even want to pay a lipa bill ever again. i don't ever want to see those initials lipa ever again. >> we're all tired, we're exhausted and we're cleaning up a mess in our houses. we just want some power back. >> usually we welcome in josh brown to talk stocks but today it's different. because josh and his family live on long island. they just got power bark on friday. 11 days after sandy hit. josh, the neighbor across the street from me is 80 years old. as of yesterday, still no power. luckily he's got a generator, he's got heat. i mean this is a national -- i understand it was a terrible storm and the crews are trying hard. but this is a national disgrace. >> i agree. i want to emphasize, we actually considered ourselves fortunate. we only went 11 1/2 days without
power. i still know people, like you do, that are still without and what i would say is, besides the crews working hard, i wouldn't lay this at the feet of the crews because i got to tell you, i've net lipa crews native to long island, as well as guys from texas, from alabama, they are doing their best. but a lot of them are saying they really don't know what to do with themselves. they haven't gotten the right amount of leadership. a lot them have not been taken to where they need to be. don't forget, they don't belong here. for them to work in the dark and have no idea where they are is kind of ridiculous. a lot of them are basically saying, look, there's more confusion at lipa than at any other utility they've ever been contracted out or worked for. i think there are two issues here that everyone in america needs to understand. preparation leading into a storm that you know is coming, and then the aftermath. let me just address those two really quickly, because this is what everyone from my area of the country wants to hear said on television. number one -- when you talk about rolling the dice, these
guys at lipa -- which by the way is a creature of the state, just like the mta, just like port authority. >> it is a quasi governmental agency. >> basically. >> a bureaucracy on bureaucracy on bureaucracy. >> well they're not really accountable until a politician gets himself in trouble and needs a football to kick. so they had this opportunity to staff up and bring in outside crews which is very common when you know there's some kind of a hurricane or snowstorm coming. they only contracted for 1,200 crews initially. now they've gotten up into the high like 8,000 or 9,000 from what i've heard. but that took them two weeks to do. there was really no preparation. this is a year after irene. second thing to keep in mind -- they committed in 2006 that they were going to send something like $20 million a year to be prepared for exactly this kind of thing. news day went back and did the audit. turns out they only spent $12.5 million a year.
guys are twiddling their storms with a storm coming saying, well, it's a category 1 and you have this infrastructure uniqueness. >> the guys, the men and women coming from missouri and alabama -- >> it's not their fault. >> no, they're butting their butt. god bless them! >> they're working 16, 18-hour shifts. >> let me finish this. i want to make it clear those men and women are busting their can and good for them. but you're right, if you're not from the area and you don't know even where you are, much less where to go, there's no direction. what you're talking about, josh, is lack of leadership because of ill planning and probably, as we'll go back, stupid cost cuts and that's a bigger story on infrastructure in america. you never spend money until the bridge collapses. >> what it reminds me of is too big to fail banking from the last decade. it's got that same feel. these guys are unaccessible. now i just want to get into communication post-storm. this is what's driving people crazy right now. we all understand trees went
down, we have aging infrastructure. everyone gets that that's the challenge. but the communication has been absolutely despicable. you're talking about a website that's barry updated. their claim to fame is this power outage map. let me tell you, you don't need a map to tell you whether or not have you power. can you flick a switch or see the goosebumps on your arm from the cold. what they've done essentially is this concept where they tell residents they're going to go house to house an inspect 300,000 homes that were still without power at the beginning of last week. well, they freak everyone out, people sit home, they're looking for inspectors, the whole thing was just handled completely by the seat of their pants and that's why we want to see these guys fall on their swords and we want cuomo to bring in new management. it is the only way forward at this point. >> it is not a local story. it is a great lesson for every community in america, be prepared, hold your leaders accountable. josh, i'm glad you and your family got your power back on. >> thank you for the soap box. i appreciate it. >> a lot of us here are on it.
julia boorstin, you got numbers on halo, the video game. >> i do. breaking news here, brian. halo 4 has sold more than $220 million in global sales in its first 24 hours. that is a record, up from $170 million in first-day sales when halo 3 came out in 2007. the first week of sales is on track to reach over $300 million. but i want to point out, that's exactly the same as halo 3 did in 2007. it raises concerns maybe the game is losing momentum ahead of the call of duty launch tomorrow. >> julia, thank you. up next, sex and the ceo. should anybody care what a ceo does in his down time? is their bedroom behavior fair game for the boardroom? we'll debate next.
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the question all investors are asking themselves right now, should you be taking profits on some of your big winners because the fiscal cliff triggers massive tax hikes. both sides of that issue coming up. plus, how rich is rich? some say a fiscal cliff could be reached if taxes are raised only on people making more than $1 million a year. and twitter co-founder jack dorsey is back for an exclusive interview today. we'll find out once and for all if a twitter ipo is in the works. we look forward to seeing you this veterans day coming up at the top of the hour on "closing bell." america seemingly cannot get enough of the sex scandal surrounding former cia chief david petraeus but two other high-profile sex scandals have made for quite a juicy monday in the business world. joseph rogers from waffle house accused by a form eer aide of demanding sex acts. christopher kubasik of lockheed
martin also accused. jeff, first to you. does it matter? >> it does matter. for public officials, people we put our trust in, if there is a violation of the law as there was, say, allegedly with dominic strauss-khan, the head of the imf, in this case it could be an abuse of public resources. there is a universal miller to code of justice where adultery is an unam big russ nbiguous no petraeus has forced out sergeants for the exact same violations. the third issue is if there is a public safety issue involved here. we're seeing there is possibly -- at least the fbi was suggesting -- that some of this libyan information about where the cia was involved and is a
huge controversy now as to whether or not there were some libyan militia people who had been arrested. she shouldn't be talking about this, his mistress, in public. these are critical issues. there is just consistency, as the code said. >> i think we all get that aspect of it. jeff, certainly what she knew, what might have been told, the e-mails, as some people have pointed out, sort of disqualifies petraeus from the job already because of what he was talking about allegedly. but reverend, i want to ask you this -- there's the morality of it, but is it our business from a business perspective? >> brian, that's a great question. you know, ross perot, a great businessman, said years ago that he would never hire an adulterer because he figured out that if a man would lie to his own mate, he wouldn't have any problem lying to his employer. i think we ought to be compassionate here and realize none of us is immune from this sort of temptation. but the fact is, a person's character counts and you can't
isolate their character. you can't say they're going to show great integrity with their board members an shareholders and constituency and show no character at home. a person's character affects every area of his life, and so that's why i think it is our business and the business of sto stockholders and authorities about the character of their leaders. >> well said. jeff, do you agree it basically makes a leader almost automatically untrustworthy? >> it's diminished his credibility to lead. it's the military term for it is prejudicial to good order and discipline. but if you have violated the same code of conduct, you have punished others for, it certainly diminishes his credibility irreparably. the issue of blackmail which was also a threat in this particular situation. but you really want to worry about getting too much on the feeding frenzy of the human frailty issue here. this was a tragic situation. he was a great hero. many people have said he was the
leader of the likes of general george marshall or perhaps like omar bradley or dwight eisenhower. his counterinsurgency strategies turned things around dramat dramatical dramatically. it's a shame he's brought down by this but it's fair and appropriate. you become the subject of late night humor with her name being, what -- of course, you know, if it's -- >> i understand. >> broadwell or being imbedded and all this other nonsense, de reveal much of himself to you in ber vi interviews with jon stewart. it goes on and on with the credibility and loss of moral -- >> i understand it. listen, you know, i mean the reality is we had donna rice on earlier in the show. where does forgiveness come in all this? >> i think forgiveness is very important. the good news is god is willing to forgive if we're willing to ask for that forgiveness. i think all of these men can have new careers and started over again. i would make this point and i
think it's very important. the greatest challenge for any leader is learning to lead himself. we're talking about generals today. i think about alexander the great. it was said of him, he was able to conquer the world but he couldn't conquer himself and he lost his kingdom. that's why it's so important for every leader to learn how to conquer himself, to learn self-control or he'll find himself or herself in the same situation. >> i'm not saying this is true. the reverend and i might disagree, if it came to jack welch or bill clinton, they made decisions in how to live their private lives, use of public resources, i think there are some criteria for judging here and it isn't a blanket morality. >> it is multilayer. that's why we try to bring it in. where's the line for what matters for business. thank you very much. take care of. >> thank you for having us. next, america, that close to being the king of oil. see what our world might look
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overtake saudi arabia as the world's biggest oil producer. what does that mean? let's bring president of lipow oil producers. great headline. sounds fantastic. is it going to happen? >> well, there's a good chance it will happen if you look at oil production in the u.s. it's risen quite substantially over the last year. and this shale oil revolution, if you will, due to lower cost has really changed the landscape out there of producing oil. >> what does it mean, though, for us? full energy independence? tell opec to hit the road? >> well, what it really means is that the u.s. would only have to rely on canada and mexico for its oil imports. and we could really tell opec to seek other markets elsewhere in the world. we would really any longer have to supply them with energy security, with having troops in the middle east or other areas of the world. >> if we get -- let's say 2020 comes, and i hope it will, mayans aside, right, and we have
full energy independence, where will the price of oil and gas be? >> well, i think oil and gas prices are still going to go up because world oil demand continues to increase. today we're still sitting at around $3.50 a gallon for gas and about $100 for oil. i'm expecting prices will rise to about $110, $115 over the long term. >> no matter what. so, neshg, inflation aside because prices always go up, we'll have higher prices regardless, right? >> that's my expectation. there's no doubt up. look at the iaea, they say oil demand will rise from about 87 million a barely as day to over 100 million barrel as a day. we have found all the cheap oil, so the cost is going to go up. what the increased production does do is it tempers those price rises and keeps the money here in the u.s. >> thank you for joining us. >> thank you. up next, boris is going to need a shot.
russia bans its national pastime. that's next. [ female announc] today, it's not just about who lives in the white house, it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office, but we honor the cubicle, and the home office as well. because today it's about all of us. and no matter who you are, you're the commander-in-chief of your own life. ♪
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